The finance minister said sometime ago that governance cannot be frozen by the model code of the Election Commission. It prevents the government from announcing new policies or projects that could be interpreted as inducements to voters. The Reserve Bank of India is scheduled to announce its annual monetary policy on April 1, a few days before the election process begins. Would it not be violating the code? The central bank is generally credited with being apolitical. However, a reduction in policy rates, even if warranted by economic circumstances, could be criticised on the ground that it favours the government in an election period. Would there be a problem if the policy announcement was postponed to a day after the elections or, even better, after the final Budget for 2014-15? Should there be an economic emergency, ad hoc policy changes could be announced with the Election Commission's approval.
A Seshan Mumbai
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